Weekly Flows Analysis – The Fed minutes boost gold
Gold ETPs registered strong inflows after the release of the Federal Reserve (Fed) minutes of the March meeting on Wednesday suggested the chances of a rate hike in the short term were extremely limited. The larger than expected draw on US crude oil inventory helped maintain flows into oil ETPs steady. Inflows into broad commodity basket have risen to their highest level since December last year.
Inflows into broad baskets indicate a stronger interest from investors led by gold rebound and energy. Inflows into commodity baskets rose by their highest level since early December 2015 (US $27.3mn).
Precious metals benefited from the increased risk aversion following the release of the Fed’s minutes. Gold ETPs attracted larger inflows last week, US $118.6mn from US$96.8 the week before, as investors scaled back expectations for further rates hikes in the US. The minutes of the Fed’s March FOMC meeting released Wednesday showed officials seeing persistent external risks and the threats they posed to the US economy. As a result, the odds of a rate hike in December have dropped to 48 percent from 58 percent earlier last week, based on Fed-fund futures data. Market participants now expect policy makers’ next move in February 2017. The increase of risk aversion and the subsequent decline of the US dollar versus Japanese Yen and Euro, led to the gold rally last week. Silver ETP inflows also increased last weak reaching their 4 week high, marking seven consecutive weeks of increase.
Energy ETPs continue to attract strong inflows, led by Brent oil ETPs (US$17.6mn). Ahead of Doha meeting on April 17, oil prices advanced last week on speculation over whether an accord to freeze or cap output can be reached. Saudi Arabia said it will only agree to a freeze if other suppliers do so, while Kuwait said a deal can be done without Iran’s support. On the other hand, WTIcrude oil ETPs received inflows worth US$15.3mn as US oil inventories were drawn down more than expected.
Copper ETPs attract US$10.8mn of inflows amid declining price. Inflows into copper reached US$10.8mn last week reflecting investors bargain hunting after copper has declined 4.4% last week to a six-week low of $4,630 per ton. In addition, aluminium ETPs inflows surged to their highest level in six months (US$12.7mn).
Key events to watch this week. Industrial production data in some of the world’s largest economies (US, Euro area and China) will give investors a gauge for how demand for commodities is faring. Additionally, markets participants will also be looking at retail sales and the Empire State survey of manufacturers in the US. Separately, inflation figures in the euro area, UK and US will also be of greatest interest for investors. The Bank of England will conduct its monetary policy meeting on Thursday. The decision is broadly expected by market participants to remain unchanged (i.e. total asset purchases of £375bn and base rate at 0.5%).
Video Presentation
Morgane Delledonne, Fixed Income Strategist at ETF Securities provides an analysis of last week’s performance, flow and trading activity in commodity exchange traded products and a look at the week ahead.
For more information contact
ETF Securities Research team ETF Securities (UK) Limited T +44 (0) 207 448 4336 E info@etfsecurities.com
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iShares NASDAQ 100 SwapUCITSETF USD (Acc) (N100 ETF) med ISIN IE0001ZFMLN7, försöker följa Nasdaq 100®-indexet. Nasdaq 100®-indexet spårar ett urval av 100 aktier valda bland icke-finansiella aktier noterade på NASDAQ-börsen.
Den börshandlade fondens TER (total cost ratio) uppgår till 0,20 % p.a. ETFen replikerar det underliggande indexets prestanda syntetiskt med en swap. Utdelningarna i ETFen ackumuleras och återinvesteras.
iShares NASDAQ 100 SwapUCITSETF USD (Acc) är en mycket liten ETF med 4 miljoner euro under förvaltning. Denna ETF lanserades den 3 oktober 2024 och har sin hemvist i Irland.
Varför N100?
Exponering mot 100 av de största amerikanska och internationella icke-finansiella aktierna noterade på NASDAQ-börsen.
Exponering för företag inom stora industrigrupper inklusive hårdvara och mjukvara, telekommunikation, detaljhandel/grossisthandel och bioteknik.
Använd i din portfölj för att söka tillväxt på medellång till lång sikt även om fonden också kan vara lämplig för kortsiktig exponering mot index.
Investeringsmål
Fonden strävar efter att uppnå avkastning på din investering, genom en kombination av kapitaltillväxt och inkomst på fondens tillgångar, vilket återspeglar den totala nettoavkastningen för NASDAQ 100-indexet (”Indexet”).
IncomeShares passed three milestones in August. Assets under management climbed to almost $66 million, cumulative fund flows topped $72 million, and turnover across London and Xetra listings reached over $27 million. Palantir paid the highest annualised distribution yield at 57.11%. The sections below break the numbers down in more detail.
Cumulative fund flows
Fund flows track how much money investors put into or take out of IncomeShares ETPs (exchange-traded products). Positive flows mean more money coming in than going out – a sign of demand for the products.
Flows have risen every month this year. In January, they stood at $13.7 million. By the end of August, they reached $72.4 million. That’s over $8 million of new money added in August alone – the biggest increase since May.
Trading turnover
Turnover is the total dollar value of IncomeShares ETPs bought and sold on the exchanges. Higher turnover means more activity and liquidity for investors.
Turnover reached $27.3 million in August – the highest on record and more than double January’s $13.0 million. London listings (USD and GBP combined) made up $14.2 million, with Xetra listings close behind at $13.1 million. Both exchanges have seen steady increases through 2025, showing rising interest in income options strategies across the board.
Note: Figures use IDC FX rates as of the August month-end to convert GBP and EUR into USD. We apply the same August rates to all prior months to compare turnover on a like-for-like basis.
Assets under management (AUM)
AUM is the total value of assets held across all IncomeShares ETPs. It grows when new investors buy in, or when the underlying assets rise in value.
AUM grew from $13.8 million in January to $65.8 million at the end of August. It was also $8 million more than in July. Steady inflows and consistent income distributions are helping the product range build scale.
Distribution yields
Distribution yields represent the annualised income paid to investors as a percentage of the current NAV (net asset value), based on the latest month’s yield. IncomeShares ETPs aim to generate this income from selling options. Yields change each month depending on strategy performance and market volatility.
Annualised August yields (ranked highest to lowest):
Our Palantir ETP topped the list with an annualised yield of 57.11% for August, up from 30.57% in July. The stock was volatile in August, trading between $142 and $190. That wider range increased option premiums, which boosted the ETP’s yield. The ETP sells put options on Palantir stock and holds shares – the strategy used for all our single stock ETPs and the Magnificent 7 product.
The Nasdaq 100 ETP paid an annualised yield of 46.44% in August, up slightly from 44.52% in July. At the other end, Gold+ and Microsoft stayed below 7%, reflecting relatively calmer conditions in their underlying assets.
The table below shows the annalised distribution yields for all IncomeShares ETPs so far this year. Note that the bottom eight ETPs launched in late June, so they only have yields for July and August.
Key takeaways
• Fund flows climbed to $72.4 million, with August adding more than $8 million.
• Turnover hit a record $27.3 million, split almost evenly between London and Xetra.
• Palantir topped the yield table at 57%, with Nasdaq 100 and Coinbase also paying above 40%.